Ravi Kathuria: How your core philosophies must drive decisions and actions at all levels

Core management philosophies are the DNA of a business. Having a crystal-clear set of core management philosophies is pivotal to a company’s growth and sustained success. They have a profound impact on an organization because they help define and describe the business model of the organization. Your company’s philosophies must drive every decision and action at all levels. Companies that invest the time and rigorous effort to detail their core management philosophies perform commandingly in the marketplace and leave their competition behind.

To understand better what core management philosophies are and how they impact an organization, let us consider the example of Southwest Airlines, which has carefully developed a set of such philosophies that have been central to the company’s success. Southwest’s core philosophies are high-value to customers, operational excellence and a progressive culture. These three philosophies work hand-in-hand and permeate every aspect of the company. They are the Southwest’s DNA.

To provide high value to customers, Southwest offers a number of features: low fares, quality service, on-time departures and arrivals, high frequency of flights and consistency. Southwest does not compete with other airlines — it competes with your car. Its customers ask themselves, “Is it cheaper to fly or drive between two cities?” Southwest is in the business of getting people to their destination reliably without fanfare. It has trained its customers to expect only a bag of peanuts and half-a-can of soft drink. When customers receive exactly what they expect, they rate Southwest high in customer service. Consistency is what endears Southwest to its customers. Consistency is the magic recipe.

To keep costs low and deliver consistency, Southwest focuses on the philosophy of operational excellence. It keeps its operations simple, and optimizes the use of its biggest capital investment, its aircraft. The airline keeps its fleet staffed with new airplanes, uses only one type of airplane to standardize operations (prior to the acquisition of AirTran last year), and limits in-flight services.

Southwest makes sure its planes spend more time flying than on the ground. To optimize the use of its assets, it provides short-haul flights (long-haul flights cause large gaps of idle time), minimizes gate-time turn-around, and uses less-crowded regional airports so planes can get in and get out quickly — no need for them to be in holding patterns to land or waiting on the runway to take off.

A company that does not rank its culture as a large part of its DNA needs to rethink that position. Southwest’s focus on its culture is legendary. It goes through extraordinary lengths to value and respect its employees. Employees in return understand and value the company’s management philosophies.

I don’t advise arguing with any airline gate agent, but especially don’t argue with a Southwest gate agent. Even if you are upset, she or he is likely to ask you to step aside as passengers board the plane. The agents know their No. 1 goal is to make sure the flight leaves on time. They cannot risk delaying 120 passengers to satisfy one. They do care about your specific complaint, but they understand their priorities.

As you study Southwest’s approaches, you begin to understand the degree to which they have developed their core management philosophies and how well they use it. Other airlines have tried to mimic Southwest’s model by offering “lite” versions. They have not succeeded because their core management philosophies have not been well developed. That is the biggest lesson from Southwest. Carefully select your core management philosophies, your DNA and pay rigorous attention in implementing them through every aspect of your business.

Quoted in The Wall Street Journal, Barron’s and WorldNews, Ravi Kathuria is a recognized thought leader. Featured on the “BusinessMakers” show, CBS Radio and “Nightly Business Report,” he is the author of the highly acclaimed book, “How Cohesive is Your Company?: A Leadership Parable.” Kathuria is the president of Cohegic Corp., a management consulting, executive and sales coaching firm, and president of the Houston Strategy Forum. Reach him at (281) 403-0250 or [email protected]

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